China’s New Car Industry Policy Encouraging For BMW: Company Executive

08/20/2018

German carmaker BMW Group wants to take complete advantage of the opening up of the car industry in China. said a senior executive of the company in an interview to the media.

"If you look at those big collaboration projects with Chinese companies, like Great Wall, Baidu, which we announced in Berlin in July. Those all demonstrate that we are keen on making use of all the options of collaboration and engaging us in China," said Thomas Becker, vice president of governmental affairs with BMW Group.

At the time that the Bavarian car maker had first entered the Chinse market in 1994, the primary objective of the company was to manufacture combustion cars in the country for consumption fort the Chinese consumers.

"However, when you look at our industry in which direction it is going, all have fundamentally changed," Becker said. He added that a lot is being invested by BMW in the area of electrification of vehicles which it feels is the future of the vehicles industry.

He further said that this development and transformation in the vehicle industry is happening quite fast in China in comparison to other parts of the world.

There has been a marked change in the outlook of the company for the use of its existing manufacturing unit in China. while earlier the facility was primarily used to manufacturing to meet the market demand only in China, the new strategy of the company is to utilize the facility as part of an integrated global supply network for the company.

Becker said that the company is going to make its X3 electric vehicle in China with the aim of satisfying demands in both the domestic Chinese market as well as for exporting to other countries as well.

"Therefore, we think that the Chinese government is absolutely right to redefine the overall rules of industrial policy in general and the automotive policy specifically," Becker said.

Ownership limits for foreign car making companies in joint ventures in China was relaxed by the Chinese authorities with respect to special vehicle and new energy vehicle manufacturing and the policy went into force from July 28 this year. Similar rules for the passenger car segment would be implemented by 2022.

"Opening up for new shareholder ratios allows more flexibility in the way Chinese companies work with foreign manufacturers, and it allows them to have tailormade arrangement not only on shareholder ratios, but also on how to produce, how to export and how to work together. It is absolutely right and we are strongly supporting this," Becker said.

Becker however did not comment on the possibility of BMW increasing its current stake of 50 percent in the BMW Brilliance Automotive.

"For us it is clearly an important discussion and it needs to be done carefully. We move forward carefully and seriously," Becker said.

"The change in the political framework is an important signal for opening up. For us, it means lots of opportunities that we want to make use of," he concluded.